IMPACT – MEDIUM
What is the change? Malaysian authorities have announced changes to employment pass salary and contract requirements.
What does the change mean? Effective Sept. 1, the salary requirement for foreign nationals seeking Category 1 employment passes will double to 10,000 ringgits (about US$2,250) per month. Category II pass holders will have to be paid between 5,000 and 9,999 ringgits per month. Category III pass holders will have a salary requirement of 3,000 to 4,999 ringgits per month. Contract requirements will also change so that Category I permit holders will be allowed to apply for passes valid for up to five years. Category II permit holder will have to have a contract valid for up to two years.
Background: Malaysia’s MYXpats Centre announced Saturday that the following changes would be made to the Work Pass Program beginning Sept. 1:
Companies that operate within a regulated sector must obtain an approval letter or support letter form the appropriate approving agencies or regulatory bodies. Final decision-making authority on employment pass applications rests with the Immigration Department of Malaysia.
BAL Analysis: The changes to the salary requirements for employment pass holders are fairly significant, especially in Category 1, where the salary will double to 10,000 ringgits per month. Employers should take note of the pending changes and budget accordingly.
This alert has been provided by the BAL Global Practice group and our network provider located in Malaysia. For additional information, please contact your BAL attorney.
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